Pharmac's decision to delay approving funding for two new drugs for the treatment of diabetes has highlighted the shortcomings of how the agency decides which medicines to fund, according to doctor John Baker.
Diabetes Foundation Aotearoa chair John Baker says Pharmac is more focused on staying within its budget and less focused on how it can help save costs across the wider health system. Photo: LDR / Stephen Forbes
In a statement last Monday, Pharmac said it would make a decision on a proposal to fund Empagliflozin and Dulaglutide in January and would make an announcement in early February. It is the second time it has deferred making a judgment on the drugs in the last month.
Dr Baker is the chair of the Diabetes Foundation Aotearoa and works as an endocrinologist at Middlemore Hospital.
He has been a long term advocate of the medicines which he said can reduce a patient's progression to end stage kidney disease by 15 years.
Dr Baker said Pharmac's latest decision was a frustrating illustration of some of the problems with the organisation's funding model.
He said the agency's brief meant it was focused on staying within its budget and less focused on how it could help save costs across the wider health system.
Dr Baker said funding the drugs for one patient would cost between $696 and $1380 a year, whereas putting someone with diabetes on dialysis for 12 months costs $50-$90,000. He said it doesn't make economic sense to not approve them.
Dr Baker said there was also a lack of ministerial responsibility for the drug funding agency, despite the fact its board of directors was responsible to the Minister of Health.
He said this was seen every time political leaders duck for cover and refuse to comment on Pharmac decisions on the basis that it was an independent agency.
"I think part of the problem for Pharmac is the lack of political accountability. If something goes wrong, who takes responsibility for it? There's no minister of Pharmac," Dr Baker said.
"And they never wear it for Pharmac's botch-ups, and there's been a few of those over the years."
In response to questions about Pharmac's announcement on Empagliflozin and Dulaglutide, a spokesperson for Minister of Health Andrew Little said he couldn't comment on individual decisions made by the agency.
But in a statement, Little said the government remained committed to an independent review of the organisation.
"The Pharmac model has served us well over many years, ensuring that New Zealanders have access to a good range of safe, effective and modern medicines," Little said.
"A strength of the model is that medicines funding decisions are made on good clinical and technical advice with the overriding goal of achieving the best health outcomes possible for New Zealanders within the available drug buying budget.
"This government respects the independence and impartiality of Pharmac. It is not for us as politicians to second guess the experts at Pharmac about which drugs it purchases."
But he said it was a good time to look at its operations.
"As the minister ultimately responsible for Pharmac, I believe it's time for an independent non-political review of the organisation to give assurance it is working as well as possible on behalf of New Zealanders, and to identify any potential improvements."
When asked to respond to Dr Baker's comments, Pharmac operations director Lisa Williams said it looked at four key criteria when it made drug funding decisions, including need, health benefits, costs and savings and the suitability of the particular medicine.
"Within each of these four segments, we consider the impact of the disease, condition or illness of the person, their family or whānau, wider society, and the broader New Zealand health system," Williams said.
"All these factors are centred around our statutory objective to get the best health outcomes from within the available funding."